Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2025

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

The Company’s financial assets and liabilities measured at fair value on a recurring basis were as follows:


	As of March 31, 2025
(in thousands)	Level 1		Level 2		Level 3		Total
Assets
Money market investments (1)	$	—	$	6,212	$	—	$	6,212
Marketable equity securities (2)	901,059		—		—		901,059
Other current investments (3)	—		7,980		—		7,980

Total Financial Assets	$	901,059	$	14,192	$	—	$	915,251
Liabilities

Contingent consideration liabilities (4)	$	—	$	—	$	1,485	$	1,485
Interest rate swaps (5)	—		2,112		—		2,112
Mandatorily redeemable noncontrolling interest (6)	—		—		20,720		20,720
Total Financial Liabilities	$	—	$	2,112	$	22,205	$	24,317


	As of December 31, 2024
(in thousands)	Level 1		Level 2		Level 3		Total
Assets
Money market investments (1)	$	—	$	3,908	$	—	$	3,908
Marketable equity securities (2)	852,434		—		—		852,434
Other current investments (3)	—		6,309		—		6,309

Foreign exchange swap (7)	—		710		—		710
Total Financial Assets	$	852,434	$	10,927	$	—	$	863,361
Liabilities

Contingent consideration liabilities (4)	$	—	$	—	$	1,419	$	1,419
Interest rate swaps (5)	—		1,419		—		1,419

Mandatorily redeemable noncontrolling interest (6)	—		—		159,548		159,548
Total Financial Liabilities	$	—	$	1,419	$	160,967	$	162,386

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(1)			The Company’s money market investments are included in cash and cash equivalents and the value considers the liquidity of the counterparty.
(2)			The Company’s investments in marketable equity securities are held in common shares of U.S. corporations that are actively traded on U.S. stock exchanges. Price quotes for these shares are readily available.
(3)			Includes mutual funds, which are valued using a market approach based on the quoted market prices of the security or inputs that include quoted market prices for similar instruments.
(4)			Included in Accounts payable, vehicle floor plan payable and accrued liabilities and Other Liabilities. The Company determined the fair value of the contingent consideration liabilities using either a Monte Carlo simulation, Black-Scholes model, or probability-weighted analysis depending on the type of target included in the contingent consideration requirements (revenue, EBITDA, client retention). All analyses included estimated financial projections for the acquired businesses and acquisition-specific discount rates.
(5)			Included in Other Liabilities. The Company utilized a market approach model using the notional amount of the interest rate swaps multiplied by the observable inputs of time to maturity and market interest rates.
(6)			The fair value of the mandatorily redeemable noncontrolling interest is based on the fair value of the underlying subsidiaries owned by GHC One and GHC Two, after taking into account any debt and other noncontrolling interests of its subsidiary investments. The fair value of the owned subsidiaries is determined using enterprise value analyses which include an equal weighing between guideline public company and discounted cash flow analyses.


(7)			Included in Other current assets and valued based on a valuation model that calculates the differential between the contract price and the market-based forward rate.

Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation

The following tables provide a reconciliation of changes in the Company’s financial liabilities measured at fair value on a recurring basis, using Level 3 inputs:


(in thousands)	Contingent consideration liabilities		Mandatorily redeemable noncontrolling interest
As of December 31, 2024	$	1,419	$	159,548

Changes in fair value (1)	—		66,407
Capital contributions	—		80
Accretion of value included in net income (1)	46		—
Settlements or distributions	—		(205,315)
Foreign currency exchange rate changes	20		—
As of March 31, 2025	$	1,485	$	20,720


(in thousands)	Contingent consideration liabilities		Mandatorily redeemable noncontrolling interest
As of December 31, 2023	$	788	$	40,764

Changes in fair value (1)	—		1,876

Accretion of value included in net income (1)	6		—
Settlements or distributions	(719)		(91)

As of March 31, 2024	$	75	$	42,549

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(1)			Changes in fair value and accretion of value of contingent consideration liabilities are included in Selling, general and administrative expenses and the changes in fair value of mandatorily redeemable noncontrolling interest is included in Interest expense in the Company’s Condensed Consolidated Statements of Operations.